The business activities of the HCM Group, which offers diverse products and services around the world, are made possible with the support of many business partners and customers. With growing international interest in corporate social responsibility, the HCM Group shares its vision and policies on CSR with suppliers to promote CSR activities across the entire value chain.

Targets

Maintain a sound relationship with supplies and governments

Promote fair and free competition and ensure consumer interests

Prevent risks within the supply chain

Key Initiatives

Suppliers and human rights

Fair sales partnerships

Fair procurement

Corruption prevention

Progress of main activities in FY2017

Increase awareness of fair trade

Rectifying unfair trade to promote open competition and protect consumer interests is a challenge around the world today. The HCM Group is focused on transaction audits and legal compliance training for employees to ensure fair and equal trade is practiced thoroughly.

Promote CSR throughout the entire value chain

We expect our global business partners will urge not only their group companies but also their suppliers from around the world to undertake corporate activities with consideration for CSR. Going forward, we at the HCM Group will continue to distribute and promote the Hitachi Group’s guidelines on CSR among our suppliers.

Promote sustainable consumption

To attain economic growth and sustainable development, we must establish a sustainable pattern of manufacturing and consumption.
The HCM Group strives to minimize the environmental impact of products throughout the life cycle by creating environmentally conscious products in promoting sustainable consumption.

Future initiatives

In FY2017, we worked to prevent risks in the supply chain by revising the internal review process for new suppliers, in addition to requesting all of suppliers to comply with the Hitachi Group CSR Procurement Guideline. As business activities continue to expand globally, addressing procurement risks is considered an ongoing concern. In the future, we will continue to anticipate and minimize these risks.

CSR Management in the Supply Chain

CSR management in the supply chain requires not only our own initiatives, but also the sharing of our CSR philosophy with business partners and their cooperation. HCM requires the suppliers to comply, using the “Hitachi Group CSR Procurement Guideline” which contains actions we would like suppliers to take regarding CSR. For new suppliers, we revamped procedures for in-house screenings in November 2017 in order to reinforce compliance efforts. These rigorous screenings are carried out on new suppliers and include provisions in consideration of environmental and social criteria, such as anti-bribery measures.

Furthermore, we ask that procurement partners who we regularly do business with to join the Chikuhou-kai (61 member companies*) or the Tokiwa-kai (44 member companies*) for the purpose of building and maintaining partnerships with procurement partners. Both of these organizations joint seminars to foster understanding about HCM policies as well as safety, quality and the environment. They also hold presentations on examples of rationalization, skills competitions, and safety patrols led by members from both organizations.

We promote CSR activities across the entire supply chain through the continuation of these measures.

Reinforcement of used equipment distribution for value chain business

From April of 2017, Hitachi Construction Machinery (HCM) launched “The used equipment remarketing solution service” for trade-in of HCM products in Japan and a modification to meet the local emission standards and fuel quality for each country and region, where Japanese used equipment redistributed, through a consolidated subsidiary, Hitachi Construction Machinery Japan, that engages the construction equipment sales, service and rental business.

Currently, most of construction machineries operated in Japan equip the diesel engine and its peripheral equipment that is designed to use ultra-low-sulfur diesel (ULSD: sulfur content is 15 parts per million [ppm] or less), which conforms to 2011 standards of Japan’s Act on Regulation, Etc. of Emissions From Off-highway vehicles. Therefore, operating the used construction equipment generated from Japan in the area where ULSD is difficult to obtain may have a great possibility of engine trouble. Accordingly, in order to reduce the engine trouble risk when the used equipment is operated and to conform to local standards and regulations, we will remove the emission gas after-treatment device and rewrite the software of the used construction equipment as these are delivered to each market.

Consequently, this service often involves delivering a finely tuned and customized machine for customer’s applications or specifications, which also assist to improve the technical capabilities of local dealers. We offer varieties of proposal other than new machine deals which also help us to enhance our value chain business.